The approval was announced by Zamfara State governor, Abdulaziz Yari, who's the chairman of the NGF.
This was disclosed by Edo State governor, Godwin Obaseki, after the National Economic Council (NEC) meeting held inside the Council Chamber of the Presidential Villa, Abuja.
While speaking to State House correspondents after the meeting, Obaseki said the approval was announced by Zamfara State governor, Abdulaziz Yari, who's the chairman of the NGF.
He said, "Pleased with the achievements that have been made till date in the fight against insurgency, particularly in the North East, the governors of Nigeria through their chairman announced at the NEC meeting that the governors have given permission to the Federal Government to spend the sum of $1bn on the fight of insurgency.
"This money is supposed to be taken from the Excess Crude Account.
"As you know, the issue of security, particularly with regard to the North East, is a very comprehensive response by federal forces.
"So, we expect that the contribution of the states to these efforts will cover the whole array of activities required to secure the country and counter insurgency.
"We expect that the amount will include but not limited to purchase of equipment, procuring intelligence and logistics and all what is required to ensure that we finally put an end to the scourge of insurgence."
While speaking earlier, Gombe State governor, Ibrahim Dankwambo, disclosed that the Excess Crude Account had a balance of $2.317 billion as at December 13, 2017.
Thursday's meeting was chaired by Vice President Yemi Osinbajo in the absence of President Muhammadu Buhari who is in Paris, France after his participation in the One Planet Summit that took place on Tuesday, December 12.
He's expected back in the country later today.
Since the insurgency of the terrorist group escalated after a 2009 crackdown by the military, Boko Haram, chiefly under the leadership of Abubakar Shekau, has been responsible for the death of over 20,000 people and the displacement of more than 2.5 million scattered across Internally Displaced Person (IDP) camps across the country and its neighbours.
After a massive military operation resulted in the displacement of the group from its primary base in the infamous Sambisa Forest, it has resorted to suicide bomb attacks on soft targets and carried out daring attacks on military bases, with hundreds of captives still unaccounted for.